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Bank Reconciliations

bmistry

Our company is currently on Accrual Basis for GST hence Accounts Receivable are flowing straight through to the Bank Account before payments are being received. Thats fine as GST collected is paid in advance.

But it throws out Bank balance each month.

We tried changing Accounts Receivable in our Chart of Accounts to Cash Basis so it does not flow through to Bank Account on raising a new invoice but does not solve our problem. Item still shows in our Bank Account.

What else does this impact and instructions on how to proceed with this action please.

I am trying to start monthly Bank Reconciliations.

Accepted answers

All comments

Acctd4

Hi @bmistry

(You've posted under Reckon Accounts Hosted so I'm assuming that's the product you're using ?) I'm wondering if you may be misinterpreting what you're seeing …

Invoices will ALWAYS show in the Accounts Receivable account register … regardless of accounting system/program or Cash/Accrual settings.

This isn't the BANK account though as the bank account only records monetary payments made or received.

"Cash" basis reports payments made or received, "Accrual" reports document - eg Invoice/Bill - dates (regardless of payment status)

Accounts themselves are not specifically set as "cash" or "accrual", this is just a basis for reporting.

eg A customer invoice for $ 500 is dated 15/04/24 but is not paid until 15/05/24:

The $ 500 will show in the A/R account (register) on 15/04. The payment will show in the bank account on 15/05.

Reporting for APRIL on a Cash basis = $ 0 (No payment received in this month)
Reporting for APRIL on an Accrual basis = $ 500 (Invoice dated this month)

Reporting for MAY on a Cash basis = $ 500 (Payment received in this month)
Reporting for MAY on an Accrual basis = $ 0 (No Invoice dated in this month)

Hope that helps 😊

Kris_Williams

payments for invoices shouldn’t reach the bank until you enter the Receive Payment transaction and bank to the Bank account. In the chart of accounts is accounts receivable setup as such, could it have been setup as a Bank type. Not sure if this is even possible, just a stab in the dark

bmistry

Should the invoice show as debit in balance sheet journal entry?

Currently in the balance sheet, invoices are showing up as debit items@ Should they be shown as credit items?

Yes, I am using Reckon Accounts Hosted.

Perhaps I have some errors in set up?

Kris_Williams

When you process an invoice the income account is credited and the Accounts receivable account is debited.
When you do a receive payment the bank is debited and the accounts receivable account is credited

bmistry

still unable to resolve and Cecile with bank statement.While using fastcoding should it be recorded against bank account or against onvoice/bills?

Kris_Williams

Feel free to give me a call after 8 and perhaps I can help you

Kris Williams. 0415 940 843

bmistry

I can call on whatsapp.

I am in New Zealand.

What is your country code?

What time will be convenient?

Kris_Williams

our country code is 61, in 1 hour would be ok. But the only way I can really help you is to login to your file and check your setup. I understand that you may not be willing to do that but if not I can’t tell you more than already has been advised here

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